4 THE ERIE RAILWAY. Mr. NATHANIEL MARSH, in closing the active duties of receiver of the above railway, has published the following statement of the present condition of the affairs of this great road: The New-York and Erie Rail-Road Company, having previously failed to pay at maturity the coupons on the first, fourth and fifth mortgage bonds, and no provision having been made for the payment of the coupons of the second and third mortgage bonds, soon to become due, and being unable to provide for the payment of a large amount of unsecured bonds, which had become due by reason of the failure to pay the interest on them, and having other liabilities which it was not able to discharge, the trustees of the fourth mortgage, on the 2d of August, 1859, at the request of certain holders, represented to the Supreme Court that the company was in a condition of insolvency, and that the mortgaged premises were a scanty security for the mortgage debt, and that the proceeds and profits of the property were likely to be diverted from the proper payment of the interest on the mortgages, and applied to the court for the appointment of a receiver of all the effects, property and franchises of the company, with power to run and operate the rail-road while proceedings for the foreclosure of the mortgages were pending. The application was granted, and a receiver appointed, who, having given the required security, entered upon his duties on the 16th of August, 1859. By subsequent orders of court, his receivership was extended to the second, third and fifth mortgages, and he was vested with the like authority by the courts of Pennsylvania and New-Jersey, over the property of the company lying in those States. These proceedings were concurred in by the board of directors and the representatives of the unsecured bonds. The order of the Supreme Court appointing the receiver placed him in possession of the rail-road, and of all the real and personal property of the company, and its powers and franchises. On taking possession of his trust, the receiver found the affairs of the company greatly embarrassed. The income of the road, owing to the depressed state of business generally, and other causes, was barely sufficient to defray the current expenses, while claims for labor and supplies, and judgments rendered before his appointment, and rents and unpaid taxes, were pressing for immediate payment. These claims amounted to more than seven hundred thousand dollars. The forbearance of the creditors, and especially of the employees, whose pay was some months in arrears, and the cordial co-operation and aid of the board of directors, relieved the receiver from serious embarrassment; and increased earnings enabled him, in the course of four months after his appointment, to discharge all these claims, and pay the current expenses of the road. Since that time all payments for labor have been made regularly as they became due, and all supplies of the past year were purchased for cash. The sums due for supplies purchased and labor performed before the appointment of the receiver, with rents and taxes unpaid, and certain other claims and judgments which he was ordered to pay, Amounted to..... Amounting, in all, to.. $741,510 14 62,195 00 102,270 00 31,027 50 350,000 00 $1,287,002 64 The payment of this large sum out of the earnings of the road, and provision for payment of the interest in future on the mortgage debt, would have extended the term of the receiver longer than was contemplated at the time of his appointment; and the uncertainty about the amount of the earnings of the road that could be applied to the payment of mortgage interest, and the unwillingness of some of the second mortgage bondholders, whose bonds were past due, to grant any extension, led to an arrangement between the stockholders and creditors, for maintaining the mortgage securities, unsecured bonds and capital stock of the company. Messrs. DUDLEY S. GREGORY and J. C. B. DAVIS were appointed trustees under this arrangement, and to their zealous discharge of the onerous duties of the trust it is mainly owing that the interests of all parties have been preserved, and this valuable property saved from the ruinous effects of a protracted litigation. By contribution of coupons on mortgage bonds and cash by the bond and stockholders, the receiver was relieved from the payment of so much of the mortgage interest, that he was able, in the course of a few months, to pay off all arrears for labor and supplies, and resume regular payment of interest on the first and second mortgage bonds, and subsequently to pay a large amount of arrears of interest on the third, fourth and fifth mortgages, whose holders declined to come into the arrangement, as well as to pay the current interest on these bonds as it became due. The last of these payments was made in December, 1861. On representation of this fact to the court, and with the consent of all parties in interest, the receiver was authorized to convey all the property in his possession to the new company, which was done on the 31st day of December. RECEIPTS AND DISBURSEMENTS. From August 16, 1859, to December 31, 1861, the cash Leaving a balance of.... From which deduct expenses for December, paid in Leaves an available balance of...... EARNINGS AND EXPENSES. The earnings of the road for the same time were..... Expenses incurred prior to August 16, 1859, paid since,.... Expenses of operating the road to December 31, 1861, . $19,331,279 14 18,845,234 46 $486,044 68 304,592 91 $181,451 77 $13,607,132 10 $741,510 14 8,230,318 92 The expenses of operating the road, the purchase of supplies, and all claims and balances against the receiver to December 31st, as far as ascertained, are included in the above statement. The three months ending December 31, 1861, produced a larger revenue than the road ever earned in the same length of time. The gross earnings were: The expenditures for repairs of the road and machinery have been large, though somewhat less than the average of three years preceding. It has been the aim of the receiver to put and keep the track and roadbed in good condition, and he believes he has succeeded in doing so. During his term, 23,514 tons of new rails, equal to more than 230 miles, have been laid, and 956,000 new cross-ties placed in the track. The machinery and cars have been fully kept up. The efficiency of the motive power has been considerably increased, by the rebuilding of the older locomotives and extensively repairing others. Twenty have been adapted to coal burning, with a large saving in the cost of fuel. The cars are in better condition than for several years. A large number of freight cars have been rebuilt, and are now worth more than when originally put on the road. The expenses of operating the road the current year will be less in proportion to the earnings than they have been the last two years, though the occurrence of disastrous floods, one in September, on the Western Division, and the other in November, on the Eastern Division, added materially to the expenses of the first three months. In comparing the expenses of the last two years, it is seen that the value of materials on hand is $41,793 35 more than when the receiver took possession of the road, which excess should be fairly credited to expenses. The sum of $567,232 12 has been charged to construction account in two years four and a half months. Of this, $59,207 51 was expended on the Cascade embankment. The work was commenced by the old company, and its completion was required by considerations of safety and economy. For ferry slips, ferry houses and boats for the Pavonia Ferry, $62,598 has been expended. For new depot buildings and necessary tracks at Paterson, and grading of the grounds, $29,861. This expenditure was necessary, in consequence of the land on which the old depot stood having been sold, and there being no proper facilities for the accommodation of the large business of Paterson at the new station. For land and fences $14,913 75 has been paid. The larger part of this sum was paid by order of court, for lands not previously paid for, though occupied by the road. The expenditure of $67,151 12 for machine and work-shops, machinery in shops, depots and water stations, has mainly been caused by the transfer of the business from Piermont and Jersey City to Long Dock, and the large increase of freight traffic. For new side tracks and switches at Long Dock and at other places on the road, required by the increase of business and the change of terminus, about $25,000 have been expended. A very considerable portion of the track, particularly on the Delaware Division, had never been ballasted, mainly on account of the want of proper material. During the receivership, much of the unfinished portions of the track on that division have been ballasted in the most thorough manner with broken stone and gravel. Where this has been done, the expense of ballasting has been charged to construction, and the whole cost of new iron and relaying the track has been charged in current expenses. Four new locomotives have been added to the equipment, and the cost charged to construction. More than enough to cover depreciation has been added to the value of the whole rolling stock, by rebuilding engines and cars, the whole cost of which has been charged to expenses. About seven hundred freight cars have been rebuilt in the best manner, and made capable of carrying more tonnage than when new. The track, rolling stock and structures are believed to be in better condition than they have been at any time since the opening of the road. Any doubts that may have existed as to the wisdom of the purchase of the Long Dock property, and as to the expediency of the large expenditure required to bring it into use, the experience of the last few months has completely dispelled. In May last the works had so far progressed that some of the passenger trains were run through the tunnel to the new ferry, and in October all the passenger trains commenced running there. A portion of the freight which had heretofore gone to Jersey City was transferred to the Long Dock, and as facilities were furnished the quantity of freight sent there was increased, till about the last of December, the whole business, freight and passenger, was concentrated there, and no trains, except a local passenger train, have since been run to Piermont. The receiver is not prepared to state in detail the value of this terminus, but he has no hesitation in saying that the earnings of the road since October have been one hundred thousand dollars more per month than they would have been without it. The expense of handling and delivering freight are much less than they were when the freight trains ran to Piermont, and greater dispatch is given both to eastward and westward bound freight. The receiver is not able to make any exhibit, in figures, of the advantages of the new terminus, as it has been in use for so short a time; but he has no hesitation in expressing the opinion, that the saving of expense over the cost of doing the same amount of business at the old terminus, and the profits of the ferry, will pay the interest on the whole outlay on the Long Dock property. The charter of the Long Dock Company authorized, so far as the laws of New-Jersey could do so, the establishment of a ferry from their property to New-York; and a lease having been procured from the city of New-York, the receiver established, about the first of May last, a regular ferry between the Long Dock property, at the foot of Pavonia Avenue, and the Erie Railway depot in New-York, at the foot of Chambers-street, immediately opposite the general office of the company. At first the service was performed by one boat, making trips each half hour; but soon after another boat was added, and the trips are now made regularly every fifteen minutes. The expenses of the ferry have been comparatively large, on account of the service being performed, for the first four months, by chartered boats. Two boats have since been purchased, and a new and very superior boat has been built, and will soon be placed on the ferry. The earnings of the ferry have exceeded the expectations, and have nearly covered the current expenses. With the increase of population and business on and around the Long Dock, this ferry cannot fail to become a source of considerable revenue, and, at the same time, increase the value of the real estate of the Long Dock Company. The convenience and comfort of passengers, and greater regularity in running the trains, have been secured by the establishment of the ferry, and the want of suitable station accommodation in New-York has been supplied by spacious and well-arranged ticket offices, passenger and baggage rooms. The cost of these improvements, and of the ferry slips and other necessary fixtures in New-York, has been paid by the receiver, and charged to account of construction. The Buffalo Branch, extending from the main line at Hornellsville sixty miles to Attica, and thirty miles from Buffalo, was purchased at foreclosure sale by the trustees, Messrs. GREGORY and DAVIS, at the request of the directors of the Erie Railway Company, and the receiver was authorized to operate it until the re-organization of the company was completed. The road has been put in good repair, with a line of telegraph and other improvements, and arrangements made with the Buffalo, New-York and Erie Rail-Road Company, owning the road from Attica to Buffalo, to run passenger and freight trains in connection with the main line between NewYork and Buffalo. This enables the trains of the Erie Railway to make close connections with the trains of the Buffalo and Lake Huron, the Grand Trunk and Great Western Railways of Canada, and their connections in the Northwestern States. Through this branch the Erie Railway controls the shortest line between New-York and Buffalo, and will be able to command a considerable portion of the traffic between the two cities. In the organization and general management of the road no material changes were made by the receiver. The employees of the old company were retained, and the rules and regulations continued in force, modified only from time to time as circumstances required. The new company has also retained the employees, and adopted the rules and regulations of the receiver. In this way the road has suffered none of the evils which often follow changes of administration. In closing the active duties of his trust, the receiver takes the liberty of congratulating the stockholders that their property has been returned to them in as good condition as when it came into his hands; that the |